Page:United States Statutes at Large Volume 75.djvu/349

funds are advanced or a loan is purchased by a lender other than the
United States. I n connection with insurance 6i loans, the Secretary—
(a) is authorized to make agreements with respect to the servicing of loans insured hereunder and to purchase such loans on
such terms and conditions as he may prescribe, except that no
agreement shall provide for purchase by the Secretary at a date
sooner than three years from the date of the note; and
(b) shall retain out of payments by the borrower a charge at a
rate determined by the Secretary from time to time equivalent to
not less than one-half of 1 per centum per annum on the principal
unpaid balance of the loan.
Any contract of insurance executed by the Secretary under this subtitle shall be an obligation supported by the full faith and credit of the
United States and incontestable except for fraud or misrepresentation
of which the holder has actual knowledge.
SEC. 309. (a) The fund established pursuant to section 11(a) of the
Bankhead-Jones F a r m Tenant Act, as amended, shall hereafter be
called the Agricultural Credit Insurance Fund and is hereinafter in
this subtitle referred to as the "fund". The fund shall remain available as a revolving fund for the discharge of the obligations of the
Secretary under agreements insuring loans under this subtitle and
loans and mortgages insured under prior authority.
(b) Moneys in the fund not needed for current operations shall be
deposited in the Treasury of the United States to the credit of the fund
or invested in direct obligations of the United States or obligations
guaranteed by the United States. The Secretary may purchase with
money in the fund any notes issued by the Secretary to the Secretary
of the Treasury for the purpose of obtaining money f0|r the fund.
(c) The Secretary is authorized to make and issue notes to the
Secretary of the Treasury for the purpose of obtaining funds necessary
for discharging obligations under this section and for authorized
expenditures out of the fund. Such notes shall be in such form and
denominations and have such maturities and be subject to such terms
and conditions as may be prescribed by the Secretary with the approval
of the Secretary of the Treasury. Such notes shall bear interest at a
rate fixed by the Secretary of the Treasury, taking into consideration
the current average market yield of outstanding inarketable obligations of the United States having maturities comparable to the notes
issued by the Secretary under this subtitle. The Secretary of the
Treasury is authorized and directed to purchase any notes of the Secretary issued hereunder, and, for that purpose, £he Secretary of the
Treasury is authorized to use as a public debt tr?insaction the proceeds
from the sale of any securities issued under th^ Second Liberty Bond
Act, as amended, and the purposes for which such securities may be
issued under such Act, as amended, are extended to include the purchase of notes issued by the Secretary. All redemptions, purchases,
and sales by the Secretary of the Treasury of such notes shall be
treated as public debt transactions of the United States.
(d) Notes and security acquired by the Secretary in connection with
loans insured under this subtitle and under prior authority shall
become a part of the fund. Notes may be held in the fund and collected in accordance with their terms or may be sold by the Secretary
with or without agreements for insurance thereof at the balance due
thereon, or on such other basis as the Secretary may determine from
time to time. All net proceeds from such collections, including sales
of notes or property, shall be deposited in and become a part of the
fund.
(e) The Secretary shall deposit in the fund such portion of the
charge collected in connection with the insurance of loans at least